Download Pain Points of Product Conversion Presentation

Pain Points of Product Conversion
WHERE DO THOSE PRODUCTS COME FROM AND WHY THIS
UNDERSTANDING IS A BIGGER PRIORITY MORE THAN EVER
Brent Petty, CMRP
Executive Industry Consultant
Global Healthcare Team
Lexmark International, Inc.
Barbara Strain, CVAHP
Director Value Management
University of Virginia Health System
Objectives
This session will provide a roadmap for:
1.
Reviewing the mix of products in the delivery of patient care and how to pinpoint where the
value is and why.
2.
Developing strategies using standard processes, purchase driven costs and patient outcomes
helping drive the value to the organization will be understood.
3.
Analyzing a criteria based decision matrix that will reveal critical success factors such as
collaborating with clinical stakeholders, keeping supply chain management and finance in the
loop and getting to a win-win solution.
Where do those products come from?
Origin of Products – know the why

Professional Meetings
 Articles
 New staff
 Onboarding new physicians
 New contract cycle
 Supplier discontinues product
Benchmarking; price,
utilization, strategic direction

 Regulatory
 Procedure change
 Equipment – new or upgrade
Unresolvable product issues
 Other, other, other, other, other
How to Get to the What
Nurses or other clinically trained staff employed by Supply
Chain Management
Physician liaison to or employed by/leads SCM
 Alignment of institutional resources; finance, contracting,
data analysts
Value Analysis processes
New Product Introduction standard work
One example of a decision matrix
Initiative Decision Matrix
Intiative Description:
Stakeholders * champion
Start Date
End Date
Y/N
Product B
Y/N
Product C
Key Metrics
e xa mp l e s : h e a d to h e a d p ro d u ct(s ), n e w p ro d u ct
wh e re n o e xp e ri e n ce , p ra cti ce ch a n ge i n vo l vi n g
p ro d u cts
Acceptance Score
1.00
Final Score
Approved
Weighting
Initiative Summary
Outcome Improvement
Quality Improvement
Safety Improvement
Organization Strategic Goals
Financial Impact
DECISION CRITERIA
Outcome Improvement
Clinical Based Evidence
Length of Stay Reduction
Redo's/Restarts/Readmissions
Patient Satisfaction
Quality Improvement
Reduction in HAC (CAUTI, HAPU, C. difficile, etc.)
Actual ≥ Expected
Hand Hygiene
Reduction in Falls
Sasfety Improvement
Reduction in Needle Sticks
Reduction in Blood/Body Fluid Exposures
Reduction in Patient Handling Injuries
Medication Safety error reduction
Organization Strategic Goals
Product Standardizaiton
Product or Services Utilization
Contract Compliance/GPO
Reduction in Inventory
Pruchased Services Impacted
Value Based Purchasing Goals met
Financial Impact
Reduction in overall costs by X %
Improvement in cost/patient day
Improvement in cost/procedure or OR case
Return on Investment
Create Margin
Increase Reimbursement
Conversion Costs more than X$
Y/N
Product A
asign a 1, 0 or -1 for each decision
Y/N
Product D
Choose what is the best fit for your organization
and the initiative

• Clinical based evidence
Decision Criteria
• Length of stay
OUTCOME IMPROVEMENT
QUALITY IMPROVEMENT
SAFETY IMPROVEMENT
• Patient satisfaction
• Physician alignment
ORGANIZATION STRATEGIC GOALS
FINANCIAL IMPACT
• Efficiency
• Restarts/Redraws/Redo’s and Re-
Reduction of Hospital Acquired Infections
• Be a member of the groups working on these initiatives
 Actual performance vs Expected performance
Decision Criteria
OUTCOME IMPROVEMENT
QUALITY IMPROVEMENT
SAFETY IMPROVEMENT
ORGANIZATION STRATEGIC GOALS
FINANCIAL IMPACT
• Apply to the initiative under review
• Example Right Supply, Right Time
Time or timing to deliver supplies
Triggers/pars
Patient special needs
 Hand Hygiene
Falls Reduction
 Reduce employee injuries sticks/exposures
Decision Criteria
OUTCOME IMPROVEMENT
QUALITY IMPROVEMENT
SAFETY IMPROVEMENT
ORGANIZATION STRATEGIC GOALS
FINANCIAL IMPACT
•
•
•
•
Employee Health
Workman’s Compensation
Staff temp pool expenses
Right product, Right procedure
 Patient Handling
•
•
•
•
•
Shears
Staff injuries
Repositioning patient in bed
Transferring patient to stretcher/bed/chair
Up out of bed/down the hall
 Product Standardization
 Utilization of products or services
 Contract compliance/GPO
Decision Criteria
OUTCOME IMPROVEMENT
QUALITY IMPROVEMENT
SAFETY IMPROVEMENT
ORGANIZATION STRATEGIC GOALS
FINANCIAL IMPACT
 Reduce on hand inventory
 Purchased Services
 Decrease cost:
• per patient day
• per procedure
• per operative case
• per CMI
Decision Criteria
OUTCOME IMPROVEMENT
QUALITY IMPROVEMENT
SAFETY IMPROVEMENT
ORGANIZATION STRATEGIC GOALS
FINANCIAL IMPACT
 Return On Investment – ROI
•
•
•
•
Net cost/savings of product
Net cost of conversion
Net improvement of initiative
Overall ROI
 Create Margin
• Physician Preference Items – PPI
 Neutralize or Increase Reimbursement
Plan the Work and Work the Plan
Cross-Industry Comparison of Size,
Quality & Productivity / Efficiency
What do these numbers have in common?
0
86
1095
0
Died today - Ebola
86
Died today - Guns
1095 Died today Accidentally in US Hospitals
The way IT is designed remains part of the problem!
Tejal Gandhi, MD, president of the National Patient Safety
Foundation and associate professor of medicine, Harvard
Medical School, spoke at the hearing.
WASHINGTON | July 18, 2014
•It's a chilling reality – one often overlooked in annual mortality statistics:
Preventable medical errors persist as the No. 3 killer in the U.S. – third only to heart
disease and cancer – claiming the lives of some 400,000 people each year. At a
Senate hearing Thursday, patient safety officials put their best ideas forward on
how to solve the crisis, with IT often at the center of discussions.
•Hearing members, who spoke before the Subcommittee on Primary Health and
Aging, not only underscored the devastating loss of human life – more than 1,000
people each day – but also called attention to the fact that these medical errors
cost the nation a colossal ---$1 trillion each year!
Too much waste in the U.S. healthcare system!
2 0 September
.
~$750B
per year in waste in the US
healthcare system, according to the Institute of
Medicine. (25% of total U.S. healthcare spend)
Unnecessary services: ~$210
Excess admin costs: ~$190
Inefficient delivery of care: ~$130
Inflated prices: ~$105
Fraud: ~$75
Prevention failures: ~$55
3
68%
of specialists receive no
information from Primary Care
physician prior to referral visit
60-70%
of referrals go unscheduled
out of
10
25%
of appointments are
missed
lab tests
are reordered because
results are lost!
Institute of Medicine report: ‘Best Care at Lower Cost:
The Path to Continuously Learning Health Care in America”
17
Achieving a better way .…
The single functional requirement for the design of a jet aircraft cockpit is to facilitate interaction between the
decision – maker and the critical information. The cockpit design creates an environment that allows for efficient
and reliable interaction.
Comprehensive Care for Joint Replacement Model (CJR)
Surgeon
STRANG JR,
SURGEON
1 ROBERT T
WHITMAN, THOMAS
L
SURGEON
2
STEWART, GREGORY
L
SURGEON
3
JENKINS, TIMOTHY
D
SURGEON
4
AIKEN, MARC
SURGEON
5 A
HOMMEL, GABRIEL
J
SURGEON
6
TAGERT, BERT
SURGEON
7 E
TESTERMAN,
SURGEON
8 JOHN R
MINTER, JON
SURGEON
9 E
MILLER, BRUCE
SURGEON
10 M
KREIN, STEVEN
SURGEON
11 W
SURGEON
12
PARSLEY, BILLY
K
SURGEON
13
FLEENOR, MICHAEL
R
JEANSONNE,
SURGEON
14GREGORY E
MULLINS, DANNY
A
SURGEON
15
FRANCE, JEFFREY
J
SURGEON
16
PARK, JASON
SURGEON
17 C
PHILLIPS, JOHN
SURGEON
18 H
RIGGINS, PATRICK
J
SURGEON
19
Potential Savings =====>
MSDRG 470
Total Knee
$8,070
Total Knee
Volume
1
Not to Exceed
Group Average
$8,070
$8,070
$8,070
Best in Class
$8,070
$8,070
$8,273
89
$736,311
$736,311
$736,311
718,262
$8,879
1
$8,879
$8,879
$8,879
8,070
$9,167
50
$458,368
$458,368
$458,368
403,518
$9,244
4
$36,976
$36,976
$36,976
32,281
$9,802
13
$127,431
$127,431
$127,431
104,915
$9,936
63
$625,989
$625,989
$625,989
508,433
$10,183
27
$274,940
272,608
$268,281
217,900
$10,227
105
$1,073,809
1,060,142
$1,043,314
847,388
$10,374
121
$1,255,306
1,221,687
$1,202,295
976,514
$10,379
18
$186,827
181,739
$178,854
145,266
$10,404
1
$10,404
10,097
$9,936
8,070
$10,455
9
$94,099
90,869
$89,427
72,633
$10,468
5
$52,340
50,483
$49,682
40,352
$10,676
57
$608,549
575,505
$566,371
460,011
$10,747
33
$354,646
333,187
$327,899
266,322
$11,019
93
$1,024,785
938,983
$924,078
750,543
$11,263
11
$123,888
111,062
$109,300
88,774
$11,706
10
$117,056
100,966
$99,363
80,704
711
$7,178,674
$6,949,352
$6,870,824
$5,738,026
$10,097
$9,774
$9,664
$8,070
Total Spend
$229,321
25 Percentile
$307,849
$1,440,648
Example --Scorecard Orthopedic
470 Major joint replacement or reattachment of lower extremity w/o MCC
81.51 TOTAL HIP REPLACEMENT
GOAL
GOAL
Measure Value
GOAL
Measure Value
GOAL
Risk-Adjusted Risk-Adjusted Risk-Adjusted
Mortality
Complications Readmission
Index
Index
Index
(RAMI)
(RACI)
(RARI)
Measure Value
GOAL
Measure Value
GOAL
Clinically
Adjusted
LOS Per
Case
Margin per
patient
Measure Value
GOAL
Total Cost
per patient
Measure Value
MSDRG Name
Measure Value
MS-DRG
Supply Cost
per patient
Measure Value
Total
Volume
GOAL
$3,860
13
$6,349 $5,907
$8,663
$4,405
3.2
0.00
0.00
5.92
81.52 PARTIAL HIP REPLACEMENT
2
$4,399 $3,055
$6,299
$5,722
3.3
0.00
0.00
31.94
81.54 TOTAL KNEE REPLACEMENT
27
$5,131 $6,626
$7,783
$6,823
3.0
0.00
0.00
0.00
LEGEND
Total or Exp Payment (greater) - SC + Direct Variable
Supply Cost
per patient
GOAL
Measure Value
MSDRG Name
Measure Value
Total
Volume
MS-DRG
Red
GOAL UNMET =
470 Major joint replacement or reattachment of lower extremity w/o MCC
81.51 TOTAL HIP REPLACEMENT
GOAL
Total Cost per
patient
GOAL
Clinically
Adjusted
LOS Per
Case
Margin per
patient
GOAL
GOAL
Risk-Adjusted Risk-Adjusted Risk-Adjusted
Mortality
Complications Readmission
Index
Index
Index
(RAMI)
(RACI)
(RARI)
GOAL
GOAL
$3,860
42
$5,257
$6,912
3.1
0.00
0.67
0.00
81.52 PARTIAL HIP REPLACEMENT
8
$2,124
$4,189
5.2
0.00
0.00
0.00
81.54 TOTAL KNEE REPLACEMENT
89
$5,397
$7,412
3.1
0.00
0.30
0.42
LEGEND
Physician
Attending Physician of Record
Total SC
Actual MSCM
Measure Value
HPM
Margin
SC Goal1 Std Deviation from Lowest Cost
Green
Measure Value
Total Cost
GOAL MET =
Measure Value
Actual MSCM
Measure Value
Total SC
Measure Value
Attending Physician of Record
Measure Value
Physician
GOAL MET =
Green
SC Goal1 Std Deviation from Lowest Cost
GOAL
Example --Scorecard Slipper Socks
Scorecard
Slipper socks
MFG
Price
Fall per
QTR
GOAL
Parity
Floor
A400
A
$1.73
3
Floor
2West
B
$1.85
5
Floor
ICU
C
$1.68
8
Floor
Step Down
D
$2.01
12
LEGEND
Total SC
Actual MSCM
Total Cost
HPM
Margin
Total or Exp Payment (greater) - SC + Direct Variable
GOAL MET =
GOAL UNMET =
SC Goal
1 Std Deviation from Lowest Cost
GOAL
Measure Value
GOAL
Measure Value
Falls
Measure Value
GOAL
Medicare Exp
Reimbursement
Measure Value
GOAL
Margin per patient
Measure Value
GOAL
Total Cost per
patient
Measure Value
MSDRG Name
Supply Cost per
patient
Measure Value
Measure Value
Total
Volume
GOAL
Session Wrap up:
•
Holistic
Concerned with
complete systems
rather than with the
analysis of or
dissection into parts
Wellmont Holston Valley Medical Center
•
•
Value based healthcare is a reality
– Payer based programs will drive increase focus on costeffectiveness of all aspects of care delivered
– Patients as consumers will ultimately define value
Increasing demand for clinical evidence and reducing variation to
support products.
Can you answer this question:
– “In my bundled payment cases, this product will represent an
increased cost that will directly reduce reimbursement. Why
should I use it?”